What is the function of pharmacy benefit managers (PBMs)?

Pharmacy benefit managers (PBMs) play a crucial role in managing prescription drug benefits for health insurers and their members. Their primary function involves negotiating with pharmaceutical manufacturers, deciding which drugs to include in a formulary (a list of covered medications), and determining the pricing and reimbursement rates for these medications. PBMs aim to control drug costs while ensuring patients have access to necessary medications.

Through their management of prescription drug benefits, PBMs work to streamline the processes involved in pharmacy claims, enhance cost-effectiveness for health plans, and promote the use of generics and preferred medications. This oversight ensures that benefit programs can provide coverage effectively while managing costs associated with prescription drug spending.